Saturday, January 27, 2007Bills target small wineriesThe legislation would give farm wineries the right to cart their products directly to market but bring the state into the process.RICHMOND -- The General Assembly took steps Friday to restore a measure of self-distribution to small Virginia farm wineries. Legislators had introduced several bills with different approaches to doing that, but now have rolled them into one compromise that would give farm wineries the right to cart their products directly to market but also preserve the state's time-honored three-tier alcohol distribution system. The compromise, as represented in Senate Bill 1413 and House Bill 2450, would create a nonprofit, nonstock corporation within the Virginia Department of Agriculture and Consumer Services to serve as a wholesaler. Wineries would be limited to distributing up to 3,000 cases of wine annually through the state. Anything above that would require a winery to use an independent, for-profit wholesaler. The Senate Committee on Rehabilitation and Social Services voted unanimously Friday morning to approve SB 1413, and on Thursday night, a House subcommittee voted to approve HB 2450, its version of the same bill. SB 1413 now goes to the Senate Finance Committee for consideration, while HB 2450 goes to the House General Laws Committee. The practice of self-distribution by small wineries was halted last summer after a federal judge in 2005 ruled the more than 2-decade-old practice was unconstitutional. The court said self-distribution gave in-state wineries an unfair advantage because out-of-state vintners didn't have the same right. The House and Senate bills, if approved, would bring the state into the process, allowing it to serve as the wholesale distributor for these small wineries with a much lower markup than private-sector distributors. As it is now envisioned, the state-run wholesaler would not have a warehouse, said Ann Heidig, president of the Virginia Wineries Association. To keep costs low, wineries would be responsible for storing and delivering their own wine, but wholesalers would handle all the monetary transactions and paperwork, such as invoices and purchase orders. "That's sort of how we think it may work," Heidig said, adding that state lawmakers are still working out the details. She acknowledged that, unlike self-distribution, the new system would mean some administrative hassles and an extra cost for farm wineries distributing their products through the state. But Heidig also touted the proposed legislation as a good compromise. "It will almost be like self-distribution but going through a low-cost wholesaler," she added. For now, Heidig said, the Virginia Wineries Association is dedicated to making the legislation work. "Obviously our first choice is self-distribution," she said, adding "but we recognize there are concerns that it would disrupt the state's ability to regulate alcohol." Russ Amrhein, owner of AmRhein Wine Cellars in Roanoke County, also lauded the bills as giving small wineries, and even those that have independent distributors, more flexibility in marketing and selling their wines. Although AmRhein Wine Cellars does use a distributor, Blue Ridge Beverage Co., and will continue to do so even if the bill is voted into law, Amrhein said there are certain situations, such as supplying wine to charity organizations, when having control over selling and delivering his products would be a plus. Right now, if Amrhein wants to sell his wine to a charity event at a nominal fee -- say, $1 a case -- he said he couldn't do it without going through a distributor and its markup. With the new system, Amrhein said, he could sell and deliver his products directly, but let the distributor oversee the transaction, without an extra cost being placed on the wine. "I think its a win-win situation for everybody," he said. The Senate committee also passed Senate Bill 1164, a measure sponsored by Sen. Brandon Bell, R-Roanoke County, that would encourage ABC stores to give preference to small farm wineries. |
.....Advertisement.....
|
